Venezuela pays debts owed to six international airlines

CARACAS Mon May 26, 2014 6:12pm EDT

CARACAS May 26 (Reuters) - Venezuela said on Monday it had payed debts owed to six international airlines, as the Socialist government seeks to avoid more carriers leaving the country due to outstanding payments.

The debt comes from the government requiring airlines to sell tickets in local bolivar currency but Venezuela has been slow to allow them to repatriate the earnings. Compounding the problem is the country's raging inflation, one of the world's highest at around 60 percent per year.

Venezuela owes airlines some $4 billion, according to a International Air Transport Association estimate earlier this year.

The government paid all the 2013 payments owed to AeroMexico, Insel Air, Tame Ecuador and Aruba Airlines, Finance Minister Rodolfo Marco announced on Twitter.

President Nicolas Maduro's administration has also squared away its 2012 debts with Colombia's Avianca and Lacsa-Taca, Torres added.

"Efficiency!" Marco said in a Tweet, without specifying how much the debts amounted to. "We continue to support airlines!" he added in a flurry of tweets with pictures of him meeting with airline officials.

Air Canada recently cut flights to Venezuela because of security concerns. Alitalia suspended services due to delays in repatriating revenue under currency controls and a clutch of other airlines have reduced the frequency of flights.

About 20 other airlines are still awaiting payment.

Maduro has promised to pay the debts back in full, but has also threatened to kick out any airlines that suspend service over the payment disputes and has blamed the World Cup for the halt of certain flights.

The issue has added to the economic problems facing the country, including shortages of basic goods and raging inflation. Those factors have fueled a wave of street protests against the government since February.

Venezuelans wishing to fly abroad are finding it increasingly hard to purchase tickets due to reduced numbers on sale and sky-rocketing prices. Some sit up late at night to try and book tickets online as soon as they become available.

Starting in July, the government will fix air ticket prices at around 4.5 times more expensive than the current official rate of roughly 11 bolivars per dollar, the Venezuelan Airlines Association, or ALAV, said on Monday. (Reporting by Alexandra Ulmer and Diego Ore; Editing by Lisa Shumaker)